Tag: BlockChain

Is Bitcoin's Volatility Such a Bad Thing?

One reason used by Bitcoin opponents,
to attack it is its high volatility.
Is high volatility such a bad thing for Bitcoin after all?

Highly volatile asset class

One reason why traditional investors have shunned Bitcoin is that its price has swung from one extreme to another. Its price increased from around $1,000 at the beginning of the year to a peak of over $5,000 in September 2017 (gain of +400 percent), before crashing to a low of $3,000 (-40 percent from its peak). Even this represents an improvement from the initial days when Bitcoin price crashed from $32 to $2 in 2011 (a drop of 94 percent). There have been periods of low volatility, but these have been few and far between. Bitcoin may be called digital gold, but in terms of volatility, it looks more like stock markets on steroids.

Volatility is an opportunity for traders

For day traders and short-term investors, volatility presents an opportunity for making profits. By correctly predicting the short-term trends in Bitcoin, traders can make substantial profits; much more than investors who have a buy-and-hold strategy. Highly volatile markets also create demand for secondary derivative products like options. As the cryptocurrency market develops, we could see increased trading of derivative products rather than actual trading of Bitcoin. As per the London Bullion Markets Association, it is estimated that 95 percent of gold trading in London is in unallocated metal (which is not settled). Bitcoin is still in its infancy, but as the market develops we could see the same trading characteristics in Bitcoin as well.

Bane for merchants

Merchants, no matter how tech-savvy they are, hesitate to accept Bitcoins for their goods and services. Their core competence lies in providing goods and services, not in managing Bitcoin's volatility. They work on thin margins and hate even the one to two percent transaction fees imposed by credit card companies. The Bitcoin price can move substantially between the time they accept Bitcoins from customers, and they sell these Bitcoins in exchange for their local currency. This price movement can wipe out their entire profitability. This is the reason why most merchants accept Bitcoin only through payment processors like Coinbase, which removes the risk associated with holding Bitcoins. In the end, merchants have to pay their bills using fiat currencies, not Bitcoin.

Volatility inevitable during growth

Bitcoin is a relatively new asset class. Although the level of awareness about Bitcoin among the general population has increased, only a small proportion of them hold significant amount of Bitcoins. Moreover, institutional investors have largely avoided Bitcoin, given its unregulated nature and the risks associated with it. As Bitcoin adoption increases and demand increases, its price can move up rapidly. Similarly, when there is negative news about Bitcoin, like the Chinese shutting down cryptocurrency exchanges, some of the holders of Bitcoin will sell and its price can crash rapidly. Until the holding of Bitcoin becomes widely distributed and its liquidity improves substantially, we will see substantial volatility in Bitcoin price.

China’s Crackdown on
Cryptocurrency Trading.
A Sign of Things to Come?

The Chinese government is determined to cement its place

as a leading rule maker, now in cryptocurrency.The Chinese government’s decision to order several Bitcoin and other cryptocurrencies exchanges to close shows how much of a threat they are perceived to be to financial stability and social order in China. The decision to also ban initial coin offerings altogether (the unregulated means by which funds are raised for a new cryptocurrency venture) has taken traders and analysts by surprise. China is the world’s largest cryptocurrency market with around 80 percent of Bitcoin transactions taking place in yuan. The blockchain (a digital ledger in which digital currency transactions are publicly recorded) is poised to have a massive impact on the future of finance. This recent crackdown suggests the Chinese government is determined to cement its place as a leading rule maker and power-broker in the quickly emerging area of cryptocurrency transactions and exchange.

China’s Relationship with Bitcoin

The Chinese government released a list of 60 initial coin offering trading platforms and instructed local agencies to make sure all platforms were listed and closed down. The delayed crackdown is in line with previous practice in China. The Chinese government often adopts a wait-and-see approach to activities that are largely unregulated until the magnitude of the activity becomes clear. The extent of speculative investment and the risk of losses to investors if the bubble bursts motivated the government to intervene in cryptocurrency trading. In China, the popularity of cryptocurrencies has been boosted by the tightening of controls on money moving out of the country over the past two years. This has lowered the value of the China’s currency, the renminbi, as investors seek assets in different denominations and chase higher yields. Cryptocurrencies are also popular because they can be used to transfer funds offshore and circumvent foreign exchange controls.

The government is particularly concerned with the use of cryptocurrencies and initial coin offerings to perpetrate and disguise fraudulent activity, including money laundering and ponzi type investment schemes. Chinese authorities are anxious to avoid any social unrest in the lead-up to the 19th Party Congress. The effects of the 2015 stock market collapse, where the A-share market lost one-third of its value over a period of one month, are still being felt. In some respects, the regulatory intervention in China is mirrored in other countries that have been dragging their heels in coming to terms with cryptocurrencies. It was only in July this year that the US Securities Commission issued a report determining that DAO tokens were “securities” and must be regulated accordingly.

China’s Own Cryptocurrency

In January last year, the People’s Bank of China issued a notice announcing it would be issuing its own digital version of the renminbi. The notice highlighted the benefits of a government backed digital currency in terms of cost, coverage, convenience and security. In the initial phase, it’s likely that trading in this digital currency will be limited to regulated entities such as banks along similar lines to trading on the conventional foreign exchange markets.

By launching its own digital currency, the Chinese government avoids the risks associated with privately-issued cryptocurrencies and ensuring they are not used as a means of circumventing China’s strict capital and currency controls. When China introduces its own digital currency (no formal date has yet been announced), the impact on the global economy will be significant. Not only will it challenge the existing global payment systems and establish China as a leading rule maker in this area, it will also enhance the importance of the renminbi as a global reserve currency.

against the legalization of cryptocurrency at a meeting between President Vladimir Putin and representatives of the Russian business circles and associations. Meanwhile, the finance ministry is drafting a bill to legalize cryptocurrencies such as bitcoin and regulate their circulation.

Central Bank Worried About Loss of Control

Russian President Vladimir Putin met with representatives of the Russian business circles and associations on Thursday. The meeting was attended by over 50 business leaders, CEOs of leading companies, banks and public organizations. At the meeting, Elvira Nabiullina, the head of Russia’s central bank, spoke out against the legalization of cryptocurrency in Russia. This was conveyed to journalists on Thursday by the president of OPORA Russia public association, Alexander Kalinin, according to Tass. Regarding cryptocurrencies, the central bank “opposed their legalization in the Russian Federation,” he explained,

noting that:

Elvira Nabiullina said that the central bank is against, because this is actually a loss of control over the money flows from abroad.

Meeting Between Putin and Representatives of the Russian Business Circles and Associations. Early this month, news.Bitcoin.com reported on the Bank of Russia issuing a statement warning about the risks of digital currencies including bitcoin as well as initial coin offerings (ICOs). “The Bank of Russia considers it premature to admit cryptocurrencies, as well as any financial instruments nominated or associated with cryptocurrencies, to be circulated and used in organized trades and in clearing and settlement infrastructure on the territory of the Russian Federation for servicing transactions with cryptocurrencies and derivative financial instruments on them,” the bank’s statement read.

A few days after the above statement was issued, Nabiullin said at the Moscow Financial forum 2017 that cryptocurrencies will not be admitted to the Russian market as money surrogates, Tass reported at the time.

She was quoted saying:

The use of cryptocurrency as a monetary surrogate is actively proposed for the calculation of goods and services, in our view, this has the risk of undermining monetary circulation and, of course, we will not allow the use of cryptocurrency as a money substitute.

Finance Ministry Favors Legalization

While the central bank opposes the legalization of cryptocurrencies, the Russian finance ministry is drafting a bill to legalize them, according to the Finance Minister Anton Siluanov early this month. News.Bitcoin.com reported on him stating that the draft law, which provides the legal framework for the circulation of cryptocurrencies in Russia, will be prepared by the end of this year.

As the legal framework is being drafted, discussions are underway regarding how to define cryptocurrency. Deputy Finance Minister Alexei Moiseev proposed in August for cryptocurrencies including bitcoin to be regulated as financial assets and be listed on stock exchanges, such as Moscow Exchange. However, he also suggested that they should only be available to qualified investors. This idea did not receive strong support from other government officials.The finance minister suggested at the Moscow Financial Forum that, instead of banning them from individuals, they should be made available in the same way federal loan bonds (OFZ) are currently.

The finance minister suggested at the Moscow Financial Forum that, instead of restricting them to qualified investors, they could be made available to anyone in the same way federal loan bonds (OFZ) are currently. First Deputy Prime Minister Igor Shuvalov also made a statement following Moiseev’s suggestion. Regarding Moiseev’s proposal, he said “this is only the proposal of experts,” RIA Novosti reported. He added that there is still no official definition or legislation of cryptocurrency but this matter will be seriously discussed “in the near future.”

Australia Ends Double Taxation of Bitcoin, Cryptocurrencies

The Australian government has finally and conclusively

provided a legislative end to the double taxation of Bitcoin and other cryptocurrencies. The bill will retroactively be enforced to July 1 of this year, as had been promised earlier in the year. The bill ends the practice of taxing the purchase of Bitcoin and other cryptocurrencies, according to the Australian goods and services tax (GST). The release regarding the end of the double taxation standard included

the following:

“Currently, consumers who use digital currency can effectively bear GST twice: once on the purchase of the digital currency, and once again on its use in exchange for other goods and services subject to the GST. The bill will ensure that Australians are no longer charged GST on purchases of digital currency, allowing it to be treated the same way as physical money for GST purposes."

The current Australian government hopes that the bill will open doors for greater levels of Fintech investment into the country. As the Chinese government moves to crack down on ICOs and cryptocurrencies, the Australian government is seeking to embrace the sea change in the financial world.

First Bitcoin-Only Real Estate Transaction Completed in Texas

Use cases for Bitcoin have been popping up everywhere,

with new ‘Accepts Bitcoin’ signs on everything from coffee carts to retail stores in South Africa. These adoption cases are important as the continued use of Bitcoin will only increase the adoption and price cycle, commonly referred to as a Satoshi cycle. In a new and interesting twist, an entire real estate transaction has taken place via Bitcoin. In other words, you can now buy your house with Bitcoin…at least in Texas. The transaction was for the purchase of a newly built custom home, and the full purchase price was transferred to the seller/builder via Bitcoin. The seller then converted the coin into USD. The broker for the

purchase said:

"In all of my 33 years of closing transactions, I honestly couldn't have expected something so unique to go so smoothly. In a matter of 10 minutes, the Bitcoin was changed to US Dollars and the deal was done!”

The purchase of the home as an agreement between buyer and seller represents another step toward widespread acceptance of the currency. Other companies are seeking to use tokenization of assets to allow smaller-scale real estate investment via Blockchain technology as well.

Here's The Man Who Created ICOs And This Is The New Token He's Backing

The video begins with a loud, hyper, motorized ticking noise.

The camera zooms in, between the backs of some mens’ heads, to show a conference panel. The screen gets darker, the camera jolts back and forth, then it shows the backs of chairs, then everything goes blurry …. It seems like the last video anyone would want to watch. (Quite literally. More than four years after it was published, it still only has 94 views.) But four and a half minutes in, one of the panelists begins to describe an idea he’s had:

“If you wanted to, today, start a new protocol layer on top of Bitcoin, a lot of people don’t realize, you could do it without going to a bunch of venture capitalists and instead of saying, hey, I’ve got this idea, you can — you’re familiar with Kickstarter I assume? Most of you? You can actually say, okay, here’s my pitch, here’s my group of developers — there’s a lot of developers in this room. If you get a bunch of trustworthy guys together that people have heard of and say, okay, we’re going to do this. We’re going to make a new protocol layer. It’s going to have new features X, Y and Z on top of bitcoin, and here’s who we are and here’s our plan, and here’s our bitcoin address, and anybody who sends coins to this address owns a piece of our new protocol. Anybody could do that. And I’ve been telling people this for at least a year now because I want to invest in it. I don’t have a ton of coins, but that’s where I want to invest my coins. And I’ve yet to find somebody who wants my coins. Does anybody in this room want my bitcoins because I want to—”

“I’ll take them,” someone shouts, and the video ends.

It was the 2013 San Jose Bitcoin conference. By that point, the panelist, J.R. Willett, had been hawking his crazy idea for more than a year. In January 2012, on the Bitcoin Talk forum, the Seattle-based software engineer published a white paper titled, “The Second Bitcoin White Paper.” (To quote the summary: “We claim that the existing bitcoin network can be used as a protocol layer, on top of which new currency layers with new rules can be built …. We further claim that the new protocol layers … will provide initial funds to hire developers to build software which implements the new protocol layers, and … will richly reward early adopters of the new protocol.”) Seventeen months later, still no one had tried it. Little did he know it would be five years before the idea in his white paper would become a runaway trend (built on Ethereum instead of Bitcoin, but the same concept nonetheless), raising $2 billion in just the first nine months of 2017 and leaving venture capitalists fretting about the future: the initial coin offering.

Though Willett, who’s been obsessed with Bitcoin ever since he discovered it in 2010, did finally launch the first ICO, Mastercoin (now called Omni), back in 2013, he’s not been involved in cryptocurrency in recent years — until now.He’s found what he calls “the perfect token sale” and is backing it with more than $1 million of his own money — and not even at a pre-sale price. (“I feel pre-sales stink of insider favoritism, so we’re not doing a pre-sale,” he wrote via email.) The so-called UpToken, whose sale begins October 16, is also different from the tokens that have garnered the most attention this year — those powering new decentralized blockchains and apps built on top.

So what exactly is Willett backing? What he calls the “shovels” in this digital gold rush: crypto ATMs (by Washington-based company Coinme) with tokens that offer discounts and cash back to token holders. While ATMs — physical infrastructure that have been around since the 1970s — don’t feel like they belong in a blockchain-based future, Willett says, “This really pushes crypto assets/crypto economy to new audiences and opens that gateway to people who will learn about Bitcoin perhaps just by walking in the mall and seeing the Bitcoin ATM.” Whether or not Willett's new venture aiming to "put a crypto ATM on every corner" will turn out to be an instance yet again in which he was two steps ahead or an idea whose time has passed remains to be seen.

From Penny Stocks To Magic Internet Money

In 2010, the quirky, affable Willett was a software engineer who had an intellectual interest in “these ridiculous penny stocks would float way up and crash.” He traded them on paper, but not with actual money. He was also researching, payment systems for some personal projects, when he read that credit card chargebacks could be avoided with Bitcoin. At that point he fell down the rabbit hole. “I spent days just reading everything I could about this,” he says. “I didn’t know if Bitcoin would be huge itself, but I thought, something that looks a lot this is going to take over the world and I really would like to own a piece of it.”

But with two children and another on the way, there wasn’t a lot of extra money to throw into a speculative investment — especially one in which the exchange options were, one, the “sketchy-looking” Mt. Gox website, which was named for Magic the Gathering cards and subsequently lost almost half a million dollars worth of Bitcoin, and two, mailing an envelope full of cash to a guy in Canada who would send you bitcoins back.

For months, he and his wife argued, with him insisting Bitcoin could be huge. “Watching the penny stocks — the dumbest things would suddenly take off because someone was pumping them up and others were legitimately hyping these ideas that were getting people excited, and some were blatant scams. In fact, it reminds me a lot of the ICO market today,” he says. But he believed Bitcoin could get into a speculative bubble. “People on the Bitcoin forum were already moaning about the speculative bubble from 1 cent to 25 cents. How could something go up 25 fold? Everyone was saying, this is unsustainable, this is a crash, it’s going to end in tears. And I was thinking, this could go so much higher.” Finally, after four months of bickering, his wife gave him $200 for both his birthday and Christmas and said, “Flush it down the toilet if you want to.” With that money, he launched a Bitcoin mining scheme — in which he paid random people from Craigslist monthly to run his mining software.

From Sleepless Nights To The First ICO

But mining bitcoins wasn’t enough. Willett kept lying in bed night after night, trying to imagine what would happen with cryptocurrency. He dreamed up something like contracts on top of Bitcoin, the way email is layered on top of TCP/IP, but wondered how he could pay for its development. Realizing he could float a coin on top of Bitcoin that buyers would automatically own if they sent bitcoin to fund its development, he wrote the white paper but didn’t want to play entrepreneur himself. Finally, after a year and a half of promoting his idea, he became so frustrated no one was trying out his idea, he decided to do what he called an “initial distribution” himself. “Basically the reason I did the first ICO is that I just wanted to prove that it would actually work,” he says.

The invention of the ICO “did not seem like such a big deal at the time,” though Willett says it was this “bizarre feeling of, whoa, I published a white paper and an address, and strangers were sending me money.” And though Mastercoin proposed all sorts of ideas like decentralized commerce and a decentralized exchange, Willett soon realized, “What everyone got really excited about was, hey, I can publish a paper and people will send me money. Literally within a few months, other projects were doing the same thing — the most famous of which was Ethereum.”

But Willett was correct that launching a new venture was stressful. First, soon after launching the sale, “there were literally people saying I’ve reported you to the SEC, you’re going to go to jail,” says Willett. “I got really worried about the SEC swat van — if there is such a thing — kicking down my door and dragging me off in the middle of the night.” (He hadn’t consulted a lawyer.) Then, there was the fact that, after raising $500,000 worth of bitcoins, the price jumped tenfold. Suddenly he had $5 million to keep safe. Though at first he had contractors working to develop Omni while he kept his full-time job, once the token reached 100 multiples of its ICO price, he sold just 2-3% of his tokens — “just enough to make my wife happy to be able to quit my job,” he says. But then it went down almost a hundred-fold. Within a year, he was back at his old employer, Cozi, working on a calendar applications for families.

This year, watching ICOs take off, Willett had mixed feelings. On one hand, “I worry about unsophisticated people losing their shirts,” he says. On the other, he says, “token sales allow people to participate in a number of exciting projects at a very early stage,” and he finds it exciting that projects that are doing good work can now “get the funding they might otherwise not have gotten to push the ball forward in the crypto economy.”

‘The Perfect Token Sale’

When Bitcoin ATM purveyor Coinme called Willett, he became convinced ATMs were the next big expansion of the crypto economy — as long as their network was powered by a token. He persuaded the team to adopt what they’re calling UpToken, which is designed like loyalty points, and quit his job again in July. He now serves as a contractor on the project.

While it seems counterintuitive that many people would buy digital currencies through a physical ATM, Coinme cofounder and CEO Neil Bergquist says, “Bitcoin appeals to a technical audience. The majority of the world is non-technical, and what they need is a physical portal to participate not only in the crypto economy but also in financial transactions in general.” On top of that, he says, the experience can be preferable to a process even as easy as a service like Coinbase’s where it can take about a week from time of purchase before the coins show up in your account. “We get calls and Facebook posts every day from people saying, this was amazing, I just bought my first bitcoin, it was so easy and instant,” says Bergquist. On top of that, the transaction allows more privacy, whereas signing up for an online exchange may require you to link your bank account. Plus, crypto exchanges have a long history of being hacked.

But just how popular crypto ATMs can prove to be and how much volume they can handle remains to be seen. The average ATM volume per month is only $100,000 and Coinme currently has 39 in Washington state, while fewer than 1,600 exist total worldwide, compared to an estimated three million fiat ATMs. However, Bergquist isn’t banking everything on the ATMs. “We see ATMs as the beachhead,” he says, adding that Coinme gives customers their own Coinme wallets, crypto IRA and 401(k) offerings and other financial services. The company even has a private client division for customers who want to buy and sell up to $1 million of cryptocurrency a day.

But if ATMs are the beachhead, the troops need to be increased. About 85% of all Bitcoin ATMs are located in North America and Europe, which the same geographies where the unbanked are a lower proportion of the population than the rest of the world. Perhaps a token could rev up demand for more ATMs — which is the purpose of UpToken. Every ATM user receives a cash back equivalent to 1% of the ATM fees, which range from 5-10%, in UpToken. Any customer who pays for their transaction fees in UpToken will receive a 30% discount on such fees. And UpToken holders will be able to vote on the new cryptocurrencies to be added to the network. Willett says this is the “perfect” token sale because it’s grows in accordance with the amount raised. Also, for UpToken, it doesn’t matter whether Bitcoin or Ethereum or another coin we may not yet know becomes the dominant coin.

As for whether this offering could get the “SEC swat van” to come running, Marco Santori, a partner at Cooley who is familiar with how securities law may apply to crypto assets, says the risk that a coin like UpToken is labeled a security is low. On top of that, he thinks crypto loyalty points is the wave of the future. “I think [crypto loyalty points have] the potential to unlock a tremendous amount of value in industries that have really been untouched by the technological revolution over the last 10 years. Affinity points — airline miles and loyalty haven’t changed very much over time, for example,” he says.

However, Spencer Bogart, head of research at Blockchain Capital, says the setup is like “a big Rube Goldberg machine.” Noting that he believes that tokens seem best for businesses that want to build a network effect — where early adopters benefit the more people end up joining the network — he says, “The ATM experience is not better to me because other people also use the ATM. I don’t care if 100 of my friends use the ATM or don’t use it or anybody in San Francisco uses it or doesn’t use it.” On top of that, he says competitors could just charge better rates instead of offering discounts. Or, pump-and-dumpers could buy a lot of UpTokens to have their coin added to the network and then sell if their coin wins and the price jumps.

Coinme ATM users who received UpToken with the 1% reward may not like the fact that they can't touch their Uptokens until they've amassed $10,000 in ATM transactions, but Bergquist explains this is like not being able to redeem airline miles until you've earned at least 10,000 miles.

As for Bogart's network effect criticism, Bergquist says that the vast majority of Coinme users have never purchased a Bitcoin before, so "the network effect of UpToken will be felt across the entire crypto community," he wrote via email. He also says the more ATMs that are deployed, the lower the fees, as small Bitcoin ATM operators can charge as much as 17%. As for people trying to sway elections to pump and dump, Willett, using Litecoin as an example, wrote in an email, "Of the hundreds or even thousands of people who used their UpToken to win that auction for Litecoin, undoubtedly some of them would sell Litecoin as the price went up. I don't see a problem with that. It's still great news for Litecoin to be on a massive worldwide ATM network."

UpToken is a crypto token meant to be used like loyalty points. Compared to some other blockchain projects that are attempting to bootstrap decentralized networks, it should be easy to see whether they've achieve their goal to "put a crypto ATM on every corner." As with his initial idea, only time will tell — but now many more will be watching.

Aeron Leverages Blockchain Tech
for Safer Flights

Humans have been flying since the Wright Brothers took flight

on December 17, 1903. Flying is considered to be one of the safest modes of transport that humans use. However, accidents do and will happen. It is incredibly difficult to arrive at numbers related to accidents with and without fatalities because of poor record keeping in the early days of aviation.

Boeing publishes the “Statistical Summary of Commercial Jet Airplane Accidents between 1959-2016”, which tells us that there have been 623 fatal accidents involving commercial jet fleets and 1948 total accidents in this time period. However, this number just covers commercial aviation and not private planes that meet accidents. According to the National Transportation Safety Board (NTSB), there were 1,290 air accidents just in 2014 and that too only in the United States. Wouldn’t it be wonderful if we could use new technology to reduce the amount of accidents that happen each year? Aeron is a project that intends to do just that by using Blockchain technology.

Aeron is making aviation transparent and reliable

The key issue to address is the human factor when it comes to aviation safety. Pilot errors, possible corruption in the flight schools all contribute towards unsafe skies. Aeron, by implementing Blockchain technology, can benefit pilots, airlines as well as ordinary consumers. They are planning to integrate Blockchain in such a way, so that pilot logs become more verifiable and transparent. They are also going to implement solutions that will help verify flight school credentials and help aircraft operators access uncorrupted data.

All of this is possible because the Blockchain itself is immutable and records once stored can’t be changed. Combined with the deployment of smart contracts and a cryptographically secure database, Aeron would be able to eliminate falsification, create verifiable logs and basically deliver an “airline in a pocket” through its deployable applications. The workings of Aeron are rather simple. All persons involved in the operation of the aircraft will have access to customised apps. As an example, pilots will have the functionality of personal flight logging in their app.

Aviation companies have the ability to collect and verify data from aviation schools, service companies, airlines and aircraft operators. In the wider ambit, if there is any data mismatch between any Aeron data source, it would be possible to quickly detect the problem and take corrective measures. Aeron will also enable expired pilot licenses to be detected while giving flight school students and consumers the access to a verified global database through aerotrips.com. Aeron has put up a one-pager to explain the workings of the project succinctly.

After a successful pre-sale, Aeron launches crowdsale

Aeron has successfully concluded their presale of Aeron (ARN) tokens and has raised over $1 mln. Now, they are launching a crowdsale that will help them build the platform and develop the technology required, as well as follow up with government relations and lobbying with aviation authorities. In total, 100 mln ARN tokens will be issued. ARN tokens are ERC-20 compliant. Investors have the chance to buy 60 mln of these tokens that are available during the crowdsale. The end date of the crowdsale is Oct. 23, 2017, and each token costs $0.50. Early investors will receive bonus tokens. Investors can visit the Aeron website to secure their bonus tokens. The ICO has been rated 4.8 by Icobench.

Why hold a token sale at all?

The Aeron token sale is their inclusive attempt to gather funds for the project. Aeron can this way not only gather investors from different parts of the world but also incentivize investors to promote their products. The token sale would enable participants to take advantage of liquidity as these tokens can be traded on various exchanges post the sale. After the token sale, the Aeron (ARN) token will be distributed to the buyers. A maximum of 100 mln ARN would be released and over time the supply will reduce due to lost keys etc. ARN tokens would be used both within and outside of the Aeron ecosystem. The tokens will be used for a subscription fee and transaction-based fee for log entries, commission on paid services, commission on intermediation and client introductions, as a currency for the purchase of aviation services and for flight school-related services.

Aeron is a project led by experts

Aeron is an ambitious project that will start to transform the aviation sector with the passage of time. The project is led by people who have significant experience in the aviation sector. The CEO, Artem Orange is a serial entrepreneur in high tech industries like telecom and is himself an aviation enthusiast. Nadezhda Barkanova, the CTO is a qualified air traffic management engineer with 11 years of work experience and is specialized in production of aeronautical databases, flight crew training and flight simulators. The CDO, Konstantin Gertman has 14 years of experience in consulting and market research as well as financial businesses and is the co-founder of aerotrips.com and is himself an EASA certified pilot since 2013. With this team at the helm, Aeron has the potential to benefit from years of industry experience not only in aviation but also in other crucial technical fields that the project needs to succeed long term.

What is the future for Aeron?

After the crowdsale is over, Aeron plans to utilize a big chunk of the collected funds, up to 40 percent for research and development. Marketing and promotion will take 30 percent, technology infrastructure 10 percent, lobbying authorities, legal consultancy and administration the remaining.

They have plans to build a multi-stage platform over time in phases. In the future, they will be able to offer services related to aircraft maintenance records and even tracking spare parts that would lead to great improvements in flight safety. Aeron has released a whitepaper that lays out in detail their token sale and post-sale plans. Given that they have plans to work closely with each aspect of the aviation industry, be it spare parts manufacturers, airlines, pilots and flight schools. There is a chance for investors to be able to gain from not only investing in the token sale and profiting from future increases in token price but also from the transactional revenues that the tokens will generate for the owners.

includes a mandate for a blockchain study to be conducted by the Department of Defense. Yesterday, the US Senate passed a massive defense spending package that provides hundreds of billions of dollars to the US military. Public records show that an amendment included in that bill, proposed by Senator Rob Portman of Ohio, would "require a report on cyber applications of blockchain technology" if signed into law. According to the official Congressional website, the amendment was agreed to by unanimous consent ahead of the defense bill's final vote. The research effort, according to the amendment's text is

described as:

"…a report on the potential offensive and defensive cyber applications of blockchain technology and other distributed database technologies and an assessment of efforts by foreign powers, extremist organizations, and criminal networks to utilize these technologies."

The study, additional materials indicate, is expected to be delivered six months after the defense bill is signed into law. But more steps remain before the study's mandate becomes law, however. The House of Representatives – the lower chamber of the US Congress – passed a similar bill in July, and now the two bodies have to hammer out a reconciled version and pass it.

China's IT Ministry Backs New Blockchain Research Lab

Regardless of its recent crackdown on bitcoin exchanges

and initial coin offerings (ICOs), China's government still appears committed to the potential of blockchain in other areas. According to a report by Caixin, the country's Ministry of Industry and Information Technology has launched a research facility called the Trusted Blockchain Open Lab in order to support the ongoing development of the technology in China. To be operated by the China Academy of Information and Communications Technology (CAICT), the blockchain lab will conduct research in the area of blockchain, as well as creating a platform for specialists to share their knowledge around the technology.

The news comes amid an evolving conversation about blockchain domestically.

As reported by the China Economic Review, Di Gang, vice director of the Digital Currency Research Institute within the People's Bank of China, warned at an event yesterday that technical blockchain specialists were lacking in comparison to those using the technology for economic reasons. "There have been many blockchain conferences where the number of business personnel exceeds technical personnel," the official said.

Following China's September 4 ban on initial coin offerings (ICOs) and later closure of several cryptocurrency exchanges, Reuters reports that Sun Guofeng, director general of the Digital Currency Research Institute, said that the ruling was "necessary and timely" to halt criminal activity in the sector. However, he stated blockchain itself is a "good technology," adding that "an ICO is not the only way through which one can carry out research into it."

He continued by promising the ban would not have a negative impact on the broader blockchain industry. Various tech giants in China are also currently working with the technology, including Tencent, who announced a blockchain research partnership with multinational tech corporation Intel at a conference earlier this month. Additionally, payment giant China UnionPay recently filed a patent for blockchain based ATM network, while the Midea Group, an electrical appliances manufacturer, is seeking to patent a method for mining bitcoin with household items.

Malta Unveils Blockchain Advisory Committee

Blockchain technology is fast being adopted by governments and businesses alike.

The small island nation of Malta has already made news for hosting Bitcoin meetups and offering to legalize the cryptocurrency wholesale. Recent news from the country indicates that its embrace of Blockchain technology will continue, as the government has formally announced the formation of a Blockchain Taskforce which will provide the roadmap for implementation of the National Blockchain Strategy.

Malta an ‘ideal ecosystem’?

The news was shared via a press release from the government, which stated,

Among other things:

"Apart from exploiting the opportunities that Blockchain technology offers for added efficiency in public sector processes and services, the government is ambitiously looking into the setting up of a new regulatory function with the primary objective of harnessing the technology with a legal operational framework, serving as a bold initiative leading to the formation of an ideal ecosystem for those willing to invest in Blockchain technology. "

Even as China appears to be retreating from its Bitcoin dominance, other countries appear to be willing to take up the baton and run. The Taskforce will be in charge of evaluating proposals sent by private entities seeking government contracts for Blockchain implementation.

Bitcoin Bounties to Sniff Out Online Pirates

Bitcoin is often seen as the currency of online pirates.

But content producers and rights holders may soon be embedding hidden Bitcoin bounties on to their work to help lead authorities to the pirates spreading it illegally. Anonymously claiming a hidden Bitcoin wallet embedded on a piece of media will firstly reward the so-called snitch, but also send an alert that information has been pirated and illegally shared.

Claim the bounty, report the pirate

It is a constant battle for right holders to maintain the control of their work, as blocking and closing down illegal websites is becoming more and more futile. It has seen a tech company based in South Africa called Custos Media Technologies take a different approach.

Their idea is that a hidden watermark, which contains a small amount of Bitcoin, can be placed on media files like movies or ebooks. If you’re the first person to find the watermark, you can claim the Bitcoin prize and in doing so will alert Custos. “Each watermark contains a Bitcoin wallet, with a reward for anyone who anonymously claims it once the media has passed out of the control of the original recipient,”

the company says.

“Media downloaders who want to search for such rewards can do so anonymously, from anywhere in the world. The moment a bounty is claimed — and by the nature of cryptocurrencies, this can only happen once — the transaction reflects on the Blockchain, and Custos notifies the media provider of the incident.”

Blockchain bounties make the system work

This idea set out by Custos again shows how Blockchain technology’s scope is increasing and finding more and more uses.In this case, as a bounty, the Blockchain is effective in delivering the bounty as the pirated software is found and reported.The system relies on a peer-to-peer architecture which allows users to transact directly without needing an intermediary and all transactions are recorded in a digital ledger that can’t be altered. Of course, the system also allows those doing the reporting to remain anonymous.

In part two, Cryptocurrency Is A Bubble, Revisited,
I argued you should skill up because this was the big one.
Which I’m sure many are doing right now.

Now the big question is what is going to happen next?

It is going to crash again but the trend is going to be up punctuated with gut wrenching corrections. This is only the beginning, not the end, of Bitcoin and the other 1,000 altcoins. There is only one call to make. That call is simple and was highlighted by Jamie Dimon of JPMorgan: Is cryptocurrency a fraud? JPMorgan thinks it is, and you'd think they should know, having been investigated by the likes of the FBI and fined bazzillions for such things.

However, I say no.

Clearly if you agree with Jamie Dimon and you are right that people just “can’t go around inventing their own currency,” you should just avoid the whole area. Don’t let go of that view and buy in at the top. Now that would be painful. If Dimon is right, cryptocurrencies will end badly just like many banks.

If cryptocurrencies are not frauds, they will grow. The key question, then, is what is the current market cap of all cryptocurrencies on earth now and what could it be in the future? It is currently $121 billion. (Though by the time you read this it might be a lot higher.) $121 billion is equivalent to the market cap of McDonald’s, esteemed purveyors of hamburgers.So here is the Google trends for them both–and I’ve thrown in the U.S. dollar, for fun.

Google trends for cryptocurrency versus Macdonald's and the U.S. dollarSo it looks as if Ronald, like China, needs to worry about Bitcoin becoming too important.But seriously, a financial instrument category with $121 billion float is not a material issue to the world economy.Or is it? Clearly China sees it as a looming threat. Having banned initial coin offerings (ICOs), it then banned Bitcoin exchanges, hand that triggered this crash.

I think it is very bullish that China wants to clamp down. China bans powerful ideas because it cannot stand any but its own. China just endorsed the power of cryptocurrencies so any doubts about the strength of the concept can be forgotten. If cryptocurrency is this potent, then a market cap of $121 billion is a drop in the bucket. So what should the float of a global currency platform capable of making the Chinese government skittish be?

Let’s take gold as a benchmark–after all, that is what its fans claim it is. The market cap of gold reserves is held to be $5 trillion and gold is good for nothing but dentistry, electronics and payments in times of war. So why couldn’t cryptocurrencies match it? As long as a cryptocurrency can be accessed and created then its money supply can grow to meet the needs of its user base. As Bitcoin and the likes are nowhere near the mainstream then the upside must be multiples of where it is today. That could be a striking multiplier.

So what could go wrong?

The main risk is that cryptocurrencies could be banned outright everywhere. It is an obvious thought and the one grasped at most frequently. I don’t think this will happen, as for a start, politicians don’t close their own loopholes. Furthermore, it only takes one global jurisdiction to allow cryptocurrency and the distributed nature of cryptocurrencies and the Internet leaves the door wide open for all. What is more, blockchain technology has huge potential to revolutionize economies by building a trustless infrastructure with transparency. This will disintermediate layers of inefficient gatekeepers whose rent seeking behavior gums up the economies of the world with their unnecessary tollgates.

Any economy using that technology will wield a massive economic advantage against luddites so the outcome is economically inevitable. Luddites can’t win. Have they ever? You could say cryptocurrencies are better than old style currencies and that their very nature makes them invulnerable but I feel the protection is in the pure efficiency of blockchain technologies and the giant economic advantages they will bring. Blockchain and cryptocurrencies are genies that won’t go back into their bottles and like the Internet, change everything.

Blockchain is about trustless systems. Trustless systems, of which Bitcoin is one, are the real revolution behind this surge. Trustless systems are a platform for tremendous progress. Imagine all the things in your life that would be better if you didn’t have to trust or distrust people. How many hours a week do we spend unlocking doors or substantiating facts or protecting ourselves from error and "bad actors."

Blockchain is going to be huge and it would be perverse if the thing that is driving it forwards, cryptocurrency, was somehow going to be run out of town on a rail at the same time. So while China might try and nip Bitcoin in the bud I think it is unlikely that less twitchy and less totalitarian countries will follow suit. It could happen but I believe it won’t.

So if it is not banned, what is the future?

The clamor is a clue–cryptocurrencies are creating more than $121 billion of noise, the real is trend to look at is the U.S. dollar. That is 13 trillion dollars of money talking. So if Dimon is right, Bitcoin is perhaps worth a bit more than the noise made by Big Macs, which is $23 billion dollars of happy meals, but if he’s wrong then ‘to the moon’ is certainly a possibility. How high is the moon? It is hard to judge, but I would be surprised if it was not at least 10 times as much as today. Is 100 times such a dream?

It is worth remembering that the total value of stocks on the NYSE and Nasdaq is $27 trillion. And more intriguing still, U.S. money supply is on $13 trillion. Then even more interesting still, the U.S. national debt is around $20 trillion. So there is $27 trillion of stocks, $20 trillion in bills but only £13 trillion in money.

Optically that does look right. $47 trillion in paper assets, not to mention hard assets like land, real estate etc, but only $13 trillion in money? Money starts to look like a pinch point to me. Now could that be a reason for a hunger for usable currency… could there just not be enough money about? Could the missing ingredient in the tepid world economy, which doesn’t seem to get either growth or inflation, be not enough M2 (let’s call it money)?

Could there just not be enough money to get activity going? Has it all been sumped in assets and higher technical solvency requirements? If Gresham’s law is true, and bad money drives out good, then governments better get cracking and get the money out there and save us all from stagnation and/or Bitcoin. If they don’t, then cryptocurrencies will do the trick. ICOs anyone? Bitcoin or no, it’s a new dawn and you have to be in it and it’s going to be wild.

Bank of Namibia Rejects Bitcoin Exchanges on Basis of 50-Year-Old Law

Namibia’s central bank, Bank of Namibia,

has claimed that virtual currency exchanges have no place in the African country, under its decades-old law. The central bank also announced that merchants in the country may not accept cryptocurrencies, like Bitcoin, as payment for goods and services. In its latest position paper as of mid-September 2017, the Bank of Namibia explained that Bitcoin and other digital currencies present only a “minimal” threat to its monetary policymaking role. However, it claimed that the cryptocurrencies are not authorized in the country under the Exchange Control Act of 1966.

Part of the position paper reads:

"In addition to the bank not recognizing virtual currencies as legal tender in Namibia, it also does not recognize it to be a foreign currency that can be exchanged for local currency. This is because virtual currencies are neither issued nor guaranteed by a central bank nor backed by any commodity."

Other highlights of the central bank’s position paper

The Bank of Namibia mainly cited previous reports by the International Monetary Fund (IMF) and the Financial Action Task Force (FATF) in its position paper. Among the familiar points that it raised, are the possible use of digital currencies on money laundering activities, the perceived shortcomings of a currency without support by a government or a commodity, and the potential benefits of the cryptocurrencies’ underlying distributed ledger technology, or Blockchain technology to the financial system. The central bank reiterated that it cannot endorse any activity involving virtual currencies, despite their ability to facilitate remittances and other consumer payments due to the lack of a

legal premise.

"Virtual currencies cannot be used to pay for goods and services in Namibia. For example, a local shop is not allowed to price or accept virtual currencies in exchange for goods and services. Users of virtual currencies should, therefore, exercise caution when dealing in this type of currencies or when comparing it to e-money.”

Bitcoin taking hold in Africa

In Africa, it is Kenya, Nigeria and South Africa that are the pioneers of cryptocurrency, but as the world of Bitcoin spreads, places like Tanzania are starting to show growth.